85344 Federal Register / Vol. 88, No. 234 / Thursday, December 7, 2023 / Notices 

Moreover, the Regional Education 

Officers in the Office of Overseas 

Schools will make presentations on the 

activities and initiatives in the 

American-sponsored overseas schools. 

Members of the public may attend the 

meeting and join in the discussion, 

subject to the instructions of the Chair. 

Admittance of public members will be 

limited to the seating available. Access 

to the Department of State is controlled, 

and individual building passes are 

required for all attendees. Persons who 

plan to attend should advise the office 

of Mr. Mark Ulfers, Director of Office of 

Overseas Schools Department of State, 

telephone 202–261–8200, prior to 

January 9, 2024. Each visitor to the 

Department of State meeting will be 

asked to provide his/her date of birth 

and either driver’s license or passport 

number at the time of registration and 

attendance and must carry a valid photo 

ID to the meeting. 

Personal data is requested pursuant to 

Public Law 99–399 (Omnibus 

Diplomatic Security and Antiterrorism 

Act of 1986), as amended; Public Law 

107–56 (USA PATRIOT Act); and 

Executive Order 13356. The purpose of 

the collection is to validate the identity 

of individuals who enter Department 

facilities. The data will be entered into 

the Visitor Access Control System 

(VACS–D) database. Please see the 

Security Records System of Records 

Notice (State-36) at https://

www.state.gov/wp-content/uploads/ 

2019/05/Security-Records-STATE36.pdf for additional information. 

Any requests for reasonable 

accommodation should be made at the 

time of registration. All such requests 

will be considered, however, requests 

made after January 9 might not be 

possible to fill. All attendees must use 

the 21st Street entrance to the building 

for Thursday’s meeting. 

Mark E. Ulfers, 

Executive Secretary, Overseas Schools 

Advisory Council, Department of State. 

[FR Doc. 2023–26914 Filed 12–6–23; 8:45 am] 

BILLING CODE 4710–24–P 

DEPARTMENT OF TRANSPORTATION 

Federal Aviation Administration 

[Docket No. FAA–2022–1204] 

FAA Policy Regarding Air Carrier 

Incentive Program 

AGENCY: Federal Aviation 

Administration (FAA), DOT. 

ACTION: Final policy statement. 

SUMMARY: This policy statement updates 

FAA policy regarding incentives offered 

by airport sponsors to air carriers for 

improved air service. It is longstanding 

practice for airport operators to offer 

incentives to air carriers to promote new 

air service at an airport, including both 

new air carriers serving the airport and 

new destinations served. The updated 

policy statement supersedes the 2010 

Air Carrier Incentive Program 

Guidebook. The policy statement 

includes general principles to assess 

whether an airport sponsor’s air carrier 

incentive program (ACIP) complies with 

the sponsor’s FAA grant assurances. It 

also includes guidance on the 

permissibility of various specific aspects 

of an ACIP, as well as ACIP 

implementation. 

DATES: This final policy statement is 

effective December 7, 2023. 

ADDRESSES: For information on where to 

obtain copies of documents and other 

information related to this policy 

statement, see ‘‘How To Obtain 

Additional Information’’ in the 

SUPPLEMENTARY INFORMATION section of 

this document. 

FOR FURTHER INFORMATION CONTACT: 

Kevin C. Willis, Director, Office of 

Airport Compliance and Management 

Analysis, ACO, Federal Aviation 

Administration, 800 Independence 

Avenue SW, Washington, DC 20591, 

telephone (202) 267–3085; facsimile: 

(202) 267–4629. 

SUPPLEMENTARY INFORMATION: Airports 

obligated under the terms of an Airport 

Improvement Program (AIP) grant 

agreement include virtually all 

commercial airports in the United 

States. At each of these airports, the 

airport sponsor must ensure that an air 

carrier incentive program (ACIP) is 

consistent with the sponsor’s FAA grant 

agreements, including standard Grant 

Assurances relating to economic 

discrimination, reasonable fees, and use 

of airport revenue. In the 1999 Policy 

and Procedures Regarding the Use of 

Airport Revenue, the FAA provided that 

certain costs of activities promoting new 

air service and competition at an airport 

are permissible as a tool for commercial 

airports to establish or retain scheduled 

air service. In the 2010 Air Carrier 

Incentive Program Guidebook, the FAA 

provided more detailed guidance on 

both the use of airport revenue and the 

temporary reduction or waiver of airport 

fees as an incentive for carriers to begin 

serving an airport or begin service on a 

route not currently served from the 

airport. A number of U.S. airport 

sponsors have used ACIPs in recent 

years, and the agency had the 

opportunity to review many of these 

programs for consistency with the 

sponsor’s grant agreements, Grant 

Assurances, and other Federal 

obligations. Based on that experience, 

the FAA is publishing its revised agency 

policy on ACIPs. 

I. Authority for the Policy 

This policy is published under the 

authority described in title 49 of the 

United States Code, subtitle VII, part B, 

chapter 471, section 47122(a). The 

policy will not have the force and effect 

of law and is not meant to bind the 

public in any way, and the publication 

of this policy is intended only to 

provide information to the public 

regarding existing requirements under 

the law and agency policies. Mandatory 

terms such as ‘‘must’’ in this notice 

describe established statutory or 

regulatory requirements. 

II. Background 

A. Overview of Air Carrier Incentive 

Programs 

Airports and communities of all sizes 

use air carrier incentives in order to 

attract new air service. Incentives may 

be offered to new entrant carriers to 

begin service at an airport or to 

incumbent carriers at an airport to add 

new routes. Incentives may apply to 

international or domestic service. 

ACIPs can be divided into two 

primary categories: programs funded by 

the airport itself (‘‘airport-sponsored 

incentives’’) and those funded by the 

local community (‘‘communitysponsored incentives’’). The primary 

distinction between these two groups 

relates to the funding used for an 

incentive. For airport-sponsored 

incentives using airport funds, the use 

of the funds must comply with the 

requirements of Federal law and FAA 

grant agreements for use of airport 

revenue. In contrast, communitysponsored incentives using non-airport 

funds may be used in a broader set of 

ways. Community-sponsored incentives 

have been funded by various 

community groups, including local 

governments, local chambers of 

commerce and tourism organizations 

and local businesses. Airport-sponsored 

incentives largely involve a reduction or 

waiver of landing fees and other airport 

fees. Airport sponsors may also 

contribute to marketing programs, 

provided the marketing focuses on the 

airport rather than destination 

marketing. Community-sponsored 

incentives can include more direct 

financing of routes, including minimum 

revenue guarantees, travel banks, and 

marketing funding that may include 

destination marketing. Another 


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important distinction is the role played 

by the airport sponsor. The sponsor may 

have a direct management role of the 

airport-sponsored incentive program, or 

a limited role advising the non-airport 

entity responsible for the communitysponsored incentive program. 

B. Federal Obligations 

Airport sponsors that have accepted 

grants under the AIP have agreed to 

comply with certain Federal 

requirements included in each AIP grant 

agreement as sponsor assurances. The 

Airport and Airway Improvement Act of 

1982 (AAIA) (Pub. L. 97–248), as 

amended and recodified at 49 U.S.C. 

47101 et seq., requires that the FAA 

obtain certain assurances from an 

airport sponsor as a condition of 

receiving an AIP grant. Several of these 

standard Grant Assurances relate to the 

extent to which an airport sponsor can 

provide incentives to an air carrier in 

return for new air service at the airport. 

Grant Assurance 22: Economic 

discrimination: Grant Assurance 22, 

paragraph 22.a. requires the airport 

sponsor to allow access by aeronautical 

operators and services on reasonable 

terms and without unjust 

discrimination. Paragraph 22.e. of Grant 

Assurance 22 further requires: ‘‘Each air 

carrier using such airport . . . shall be 

subject to such nondiscriminatory and 

substantially comparable rules, 

regulations, conditions, rates, fees, 

rentals, and other charges with respect 

to facilities directly and substantially 

related to providing air transportation as 

are applicable to all such air carriers 

which make similar use of such airport 

and utilize similar facilities, subject to 

reasonable classifications such as 

tenants or non-tenants and signatory 

carriers and non-signatory carriers.’’ 

The FAA has determined that a 

carrier starting new service at an airport 

is temporarily not similarly situated to 

carriers with established route service at 

the same airport. Accordingly, an 

airport sponsor may offer a waiver or 

reduction of fees and jointly market new 

service, for a fixed time and within 

certain limits, without unjustly 

discriminating against carriers not 

offering new service and not 

participating in the air carrier incentive 

program. 

Grant Assurance 22 also serves to 

prohibit an airport sponsor from 

charging carriers and other operators not 

participating in an incentive program 

for any costs of an air carrier incentive 

program. Charging non-participating 

operators for the costs of an incentive 

would be a cross-subsidy of the 

incentive program, and therefore not a 

reasonable fee component for 

nonparticipating operators. 

The FAA’s Policy Regarding Airport 

Rates and Charges provides detailed 

guidance on the acceptable components 

of carrier and other aeronautical user 

fees. Any ACIP adopted under this 

Policy must conform to the Policy 

Regarding Airport Rates and Charges. 

Grant Assurance 24, Fee and Rental 

Structure: Grant Assurance 24 generally 

requires that an airport sponsor 

maintain an airport rate structure that 

makes the airport as self-sustaining as 

possible. For purposes of planning and 

implementing an ACIP, the airport 

sponsor must assure that a marketing 

program to promote increases in air 

passenger service does not adversely 

affect the airport’s self-sustainability 

and the existing resources needed for 

the operation and maintenance of the 

airport. The Policy Regarding Airport 

Rates and Charges provides further 

guidance on compliance with Grant 

Assurance 24. 

Grant Assurance 25, Airport 

Revenues: Grant Assurance 25, which 

implements 49 U.S.C. 47107(b), 

generally requires that airport revenues 

be used for the capital and operating 

costs of the airport or local airport 

system. Title 49 U.S.C. 47133 imposes 

the same requirement directly on 

obligated airport sponsors. The FAA 

Policy and Procedures Regarding the 

Use of Airport Revenue (Revenue Use 

Policy), in section V.A.2, provides that 

expenditures for the promotion of an 

airport, promotion of new air service 

and competition at the airport, and 

marketing of airport services are 

legitimate costs of an airport’s 

operation. Air carrier operations are not 

a capital or operating cost of an airport; 

therefore, use of airport revenue for a 

carrier’s operations is a prohibited use 

of airport revenue. Accordingly, while 

an airport sponsor can assume certain 

marketing costs relating to service at the 

airport, the sponsor may not make 

payments in any form from airport 

revenue to a carrier for operating at the 

airport, including for providing air 

service at the airport. 

C. Related Federal Programs 

Essential Air Service Program: 

Following deregulation of the airline 

industry, the Essential Air Service (EAS) 

program was put into place to guarantee 

that communities that were served by 

certificated air carriers before airline 

deregulation maintain a minimal level 

of scheduled air service. The United 

States Department of Transportation 

(Department) implements this program 

by subsidizing at least a minimum of 

daily flights from each designated EAS 

community/airport, usually to a largeor medium-hub airport, except for 

within Alaska. As of May 2023, the 

Department subsidizes commuter and 

air carriers, and air taxis to serve 61 

communities in Alaska and 111 

communities in the 48 contiguous states 

and Puerto Rico that otherwise would 

not receive any passenger air 

transportation. Because the EAS 

program largely involves Federal 

payments to air carriers, the EAS 

program does not affect the 

responsibilities of an airport. Eleven 

(11) communities receive funding, via 

grant agreements, through the Alternate 

Essential Air Service (AEAS) program. 

Those 11 communities obtain their own 

air service, currently all from a 

commuter air carrier, operating all 

flights as public charters under DOT 

Part 380 regulations. 

Small Community Air Service 

Development Program. The Small 

Community Air Service Development 

Program (SCASDP) is a Federal grant 

program designed to provide financial 

assistance to small communities to help 

them enhance their air service. The 

program is managed by the Associate 

Director, Small Community Air Service 

Development Program, under the Office 

of Aviation Analysis, in the Office of the 

Secretary of Transportation. Grantees 

must be public entities and can include 

local governments and airport operators. 

Grant funds may be used for a variety 

of measures to promote air service and 

are dispersed on a reimbursable basis. 

SCASDP grant funds are not airport 

revenue and may be used for purposes 

for which airport revenue is prohibited, 

including direct subsidy of air carrier 

operations. 

Holding a SCASDP grant does not 

affect an airport sponsor’s obligations 

under its AIP grant agreements. The 

Department’s order awarding SCASDP 

grants states that a SCASDP grant does 

not relieve the airport sponsor from the 

obligation to use airport revenues only 

for purposes permitted by the AIP Grant 

Assurances and Federal law. 

Accordingly, if airport revenues are 

used as local match funds for a SCASDP 

grant, those funds remain subject to 

Grant Assurance 25; however, this 

would not prevent an airport sponsor 

using airport revenue as a local match 

to SCASDP grants similar to airport 

revenue being used as a local match to 

AIP grants. This permits airport 

sponsors to pursue reasonable strategies 

to promote the airport and provide 

incentives to encourage new air service. 


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D. The 2010 Air Carrier Incentive 

Guidebook 

Previous FAA policy on ACIPs was 

published in the Air Carrier Incentive 

Program Guidebook, issued in 

September 2010 (and referred to below 

as ‘‘the Guidebook’’ or ‘‘the 2010 

Guidebook’’). While the Guidebook 

served as a useful description of FAA 

policy on ACIPs, with the publication of 

this policy update, the FAA is 

grounding the policy more in basic 

principles rather than in a detailed list 

of prohibited practices. The intention is 

to provide more flexibility for airport 

sponsors to design particular incentive 

programs while remaining in 

compliance with Federal obligations 

regarding economic discrimination, 

reasonable fees, and use of airport 

revenue. 

E. FAA Experience With ACIPs 

In the last 20 years, and particularly 

since the publication of the 2010 

Guidebook, there has been a 

proliferation of ACIPs. ACIPs have been 

implemented at more than 250 U.S. 

commercial service airports. Some 

airport sponsors have used ACIPs on 

occasion or intermittently, while others 

have maintained ACIPs on a recurring 

and renewable annual basis. ACIPs have 

been used at smaller airports seeking to 

acquire and maintain any level of air 

carrier service, while sponsors of larger 

hub airports have also used ACIPs to 

add to existing service patterns. While 

most ACIPs have complied with Federal 

obligations as outlined in the 2010 

Guidebook, several practices have raised 

issues of compliance: 

• There have been cases where an 

airport sponsor has sought service from 

a specific air carrier and tailored its 

ACIP for that purpose, which can 

present an issue of unjust 

discrimination. 

• While sponsors have avoided direct 

cash subsidies to carriers, some ACIPs 

have included incentives that could be 

seen as efforts to circumvent the clear 

prohibition on the use of airport 

revenue for subsidy of carrier 

operations. 

• Sponsors have made direct cash 

payments to carriers for marketing costs 

under a joint marketing program 

without appropriate documentation. 

• Use of a sponsor’s community 

funds for practices such as airline 

subsidies and revenue guarantees for a 

carrier may be inconsistent with the 

sponsor’s Grant Assurances. 

• Sponsors have entered into 

incentive arrangements with a carrier 

with no notice to the public or other 

carriers of the terms of the incentive 

program. Non-participating carriers may 

have no means of determining whether 

and how the incentive program affects 

aeronautical fees at the airport. 

In consideration of agency experience 

with the oversight of ACIPs in recent 

years, the FAA is issuing this 

restatement of the agency policy on 

ACIPs. 

F. Summary of the Notice of Proposed 

Policy 

The FAA published a proposed policy 

on ACIPs on February 3, 2023, with a 

request for public comment. The 

proposed policy articulated five general 

principles to summarize the framework 

under which an airport sponsor can 

implement an ACIP: 

• Discrimination between carriers 

participating in an ACIP and nonparticipating carriers must be justified 

and time-limited. 

• A sponsor may not use airport 

revenues to subsidize air carriers. 

• A sponsor may not cross-charge 

non-participating carriers or other 

aeronautical users to subsidize ACIP 

carriers. 

• The terms of an ACIP should be 

made public. 

• Use of airport funds for an incentive 

program must not adversely affect the 

resources needed for operation and 

maintenance of the airport. 

The proposed policy also included a 

number of updates and clarifications, 

several of which differ from the material 

in the 2010 Guidebook. Key provisions 

in the proposed policy include: 

• Revising the definition of new 

service to comprise ‘‘any nonstop 

service to an airport destination not 

currently served with nonstop service, 

or any service to an airport by a new 

entrant carrier.’’ This proposed 

definition would modify the definition 

in 2010 Guidebook primarily by 

eliminating increased frequencies from 

the definition of new service, and by 

clarifying that only nonstop service 

qualifies. 

• Allowing incentives for three 

seasons (up to three years from the start 

of service) for seasonal service, which is 

defined as service offered for less than 

six months of the year. 

• Clarifying that an ACIP may be 

offered for new cargo service, separate 

from any ACIP offered for new 

passenger service. 

• Clarifying that incentives may be 

based on the number of passengers 

actually carried or the seat-miles 

associated with new service, as long as 

they are constructed in a way that 

avoids unjust discrimination and so that 

the resulting reduction in fees does not 

exceed the amount of the standard fees 

the carrier receiving the incentive 

would have been charged without the 

incentive. 

• Articulating expectations for ACIP 

transparency, including the disclosure 

of proposed ACIPs and incentives 

granted. 

• Modifying the 2010 Guidebook’s 

prohibition of airport sponsor staff from 

assisting or advising a non-airport entity 

on an ACIP that used general 

community funds, and clarifying the 

circumstances and limitations under 

which an airport sponsor can provide 

technical assistance to non-airport 

entities. 

• Clarifying that payments of 

marketing and advertising costs directly 

to a carrier under an ACIP will be 

considered a prohibited diversion of 

airport revenue, and allowing payments 

of airport revenue for marketing only to 

the entity providing the marketing 

services. 

• Modifying the expected process for 

airports with a limited ACIP budget that 

may limit incentives to a single carrier 

so that a request for proposals (RFP) 

process is no longer the stated preferred 

way to award the incentive. Instead, the 

availability of an ACIP, along with any 

limitations, needs to be publicly 

disclosed at least 30 days prior to 

entering an agreement with a carrier. 

Another difference from the 2010 

Guidebook is that the proposed policy 

in this area does not distinguish based 

on an airport’s size. 

• Clarifying that airport sponsors 

have discretion as to whether their ACIP 

applies to an air carrier restarting 

service that was previously subject to an 

incentive but had been canceled due to 

various reasons. 

• Allowing carrier incentives that 

were initiated prior to the issuance date 

of the new policy to continue until they 

expire, as long as they complied with 

the FAA’s previous policy guidance 

(with a maximum timeframe of two 

years, consistent with the 2010 

Guidebook). However, incentives 

initiated on or after the issuance date of 

the final policy must conform to the 

guidance in the final policy statement. 

The FAA also requested comments on 

whether incentives for upgauging to a 

larger aircraft type should continue to 

be allowed consistent with the petition 

partially granted to the Clark County 

Department of Aviation, Nevada, in 

2012. 

The proposed policy also addressed 

several other aspects of ACIPs and the 

ACIP process. 

The FAA invited comments on the 

proposed ACIP policy for 60 days, and 

the comment period closed on April 4, 

2023. 


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G. General Overview of Comments 

The FAA received comments from 19 

industry stakeholders. Commenters 

included Airlines for America (A4A), 

the American Association of Airport 

Executives (AAAE), Airports Council 

International—North America (ACI– 

NA), 15 airport sponsors, and one 

private company. The majority of 

individual airport sponsor comments 

represent large hub airports; however, 

the FAA also received several comments 

from sponsors for smaller airports. 

Commenters generally supported the 

FAA’s initiative to update its ACIP 

policy and guidance given the evolution 

of the aviation industry since the 

publication of the 2010 Guidebook. 

Most commenters, particularly airport 

stakeholders, supported the FAA’s 

stated goal of providing additional 

flexibility to airport sponsors to design 

ACIPs within the framework of the 

sponsors’ federal obligations, although 

there were differing perspectives on 

whether the proposed policy 

accomplishes that goal. 

Commenters had suggestions for 

modifications to several aspects of the 

proposed policy. Some areas of the 

proposed policy generated numerous 

and/or particularly strong comments, 

including: 

• The definition of new service, 

particularly the exclusion of new 

frequencies on routes that already have 

nonstop service; 

• Procedures in cases where an ACIP 

has a limited budget and can only be 

awarded to one carrier; 

• Incentives for upgauging, as well as 

incentives that vary based on passengers 

or seat-miles; 

• ACIP transparency expectations; 

• Technical assistance for non-airport 

entities; and 

• Whether funds can be paid directly 

to an air carrier as part of a marketing 

incentive. 

Comments on these and other areas of 

the proposed policy, as well as the 

FAA’s responses and, in some cases, 

changes to the proposed policy, are 

discussed in greater detail below. 

III. Discussion of Public Comments and 

the Final Policy 

The FAA has made changes to this 

policy in response to comments made 

by the public. Some of the changes are 

to terminology to improve clarity, while 

other more substantive changes are in 

response to comments raised by 

stakeholders. Summaries of the 

comments and the FAA’s responses are 

grouped by category in the following 

subsections. 

A. Policy Approach, ACIP Flexibility 

and Guiding Principles 

ACI–NA and four individual airport 

sponsors affirmed their support for the 

FAA’s stated goal of providing more 

flexibility to airport sponsors, but 

commented that they believe the 

proposed policy did not live up to this 

intention. These commenters 

recommended that the FAA adopt less 

prescriptive language in order to place 

fewer limits on airport sponsors’ ability 

to design ACIPs. ACI–NA went on to 

request that the FAA clearly state that 

the final policy has no force of law and 

eliminate any suggestion that airport 

sponsors must comply with it. 

Tampa International Airport (TPA) 

requested that the policy explicitly 

reaffirm that certain uses of airport 

revenue are permissible in accordance 

with the Revenue Use Policy. 

The FAA notes that without a policy 

that articulates criteria for which 

incentives are allowed, there would be 

no protected ACIPs, as such programs 

are inherently discriminatory. Grant 

Assurance 22 prohibits unjust 

discrimination and requires 

substantially comparable fees for all air 

carriers that make similar use of the 

airport and utilize similar facilities 

(subject to reasonable classifications 

such as tenants or non-tenants and 

signatory carriers and non-signatory 

carriers). The FAA is providing this 

policy to guide airports regarding the 

FAA’s interpretation of the grant 

assurances and to avoid unjust 

discrimination. 

For further clarity, and to address 

TPA’s comment, the FAA has added a 

sentence to the second principle in the 

policy affirmatively stating, ‘‘Fee 

reductions, fee waivers, and marketing 

assistance as incentives to new service 

are permitted to the extent described in 

the Policy and Procedures Concerning 

the Use of Airport Revenue.’’ 

Regarding ACI–NA’s comment about 

the final policy having no force of law, 

the notice of proposed policy contained 

the following statement: ‘‘The policy 

proposed under this notice will not 

have the force and effect of law and is 

not meant to bind the public in any 

way, and the notice is intended only to 

provide information to the public 

regarding existing requirements under 

the law and agency policies. Mandatory 

terms such as ‘‘must’’ in this notice 

describe established statutory or 

regulatory requirements.’’ The FAA has 

maintained a similar statement in the 

‘‘Authority for this Policy’’ section of 

this final policy statement. 

B. Definitions 

New Service: There were numerous 

comments on the definition of new 

service, particularly focused on whether 

additional service to existing markets 

should be included as eligible for an 

ACIP. 

A4A and Rick Husband Amarillo 

International Airport (AMA) 

commented that the proposed policy’s 

definition of new service was too broad. 

Some A4A members and AMA believe 

that new entrants who did not 

previously serve an airport and enter a 

market that already has nonstop service 

should not be eligible for incentives, as 

this may unfairly advantage the new 

entrant carrier at the expense of the 

incumbent carrier on the route. 

ACI–NA, AAAE, and nine airport 

sponsors commented that the proposed 

policy’s definition of new service was 

too restrictive. All of these commenters 

believe that ACIPs should be permitted 

to provide incentives for frequency 

increases in existing markets, as stated 

in the 2010 Guidebook. Several 

commenters specifically raised 

discrimination concerns or questions 

about situations where a new entrant 

carrier (that previously did not provide 

any service to an airport) could receive 

an incentive for starting service on a 

route that already had nonstop service 

from another carrier, whereas a carrier 

that already serves a different market 

from that airport could not receive an 

incentive for starting service on that 

same route. Similarly, several 

commenters believe that incumbent 

carriers should be eligible for incentives 

if they add frequencies in markets that 

they already serve. 

Some commenters had specific 

suggestions to limit the applicability of 

incentives for additional frequencies. 

Denver International Airport (DEN) 

recommended setting a minimum 

increased frequency that would qualify 

as an incentive, such as 50% over the 

previous year, and specifying the 

markets that qualify. Similarly, the 

Metropolitan Washington Airports 

Authority (MWAA) and the City of 

Phoenix Aviation Department (PHX) 

suggested that increased frequency 

incentives would be most appropriate 

for markets that the airport sponsor 

identifies as underserved. 

Multiple commenters linked their 

comments on incentives for frequency 

increases to incentives for upgauging, 

noting that both represent increases in 

capacity in markets that already have 

nonstop service and therefore it is 

logical that either both types of 

incentives be permitted or both types be 

prohibited. 


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Finally, ACI–NA also commented that 

the definition of new service should be 

expanded to include direct, one-stop 

service. Houston Airport System (HAS) 

had a similar comment, noting that 

international air service to interior U.S. 

destinations in particular may often 

begin on a one-stop basis and that cargo 

service often has enroute stops. DEN 

also requested clarification about 

whether ‘‘any service by a new entrant 

carrier’’ includes both direct and 

nonstop service. 

The FAA recognizes the logic in 

maintaining a consistent approach 

between different forms of additional 

capacity on existing routes, and that in 

many cases increased capacity on an 

existing route can be very valuable to an 

airport and the community it serves. At 

the same time, the FAA believes that 

there is a distinction between, on the 

one hand, a route going from twice a 

week service to daily service (or daily 

service to three times a day service), 

and, on the other hand, a route going 

from 10 flights a day to 12 flights a day. 

Therefore, the FAA has modified the 

definition of new service in the final 

policy to include ‘‘a significant increase 

in capacity on preexisting service to a 

specific airport destination’’ as 

permissible for airport sponsors to 

include in an ACIP. While the FAA is 

leaving the definition of ‘‘significant’’ to 

each airport sponsor to articulate in its 

ACIP based on local circumstances, the 

agency encourages sponsors who choose 

to offer incentives for frequency 

increases to consider defining a 

threshold percentage increase in order 

to qualify for incentives. 

The FAA has also added language to 

the Service Frequency section of the 

final policy to clarify that if an airport 

sponsor chooses to offer incentives for 

frequency increases on preexisting 

service, these incentives: 

• Are limited to one year; 

• May not discriminate based on 

whether the frequency addition is from 

a carrier that already serves the route; 

• Cannot be the only type of incentive 

in a sponsor’s ACIP; and 

• Should only apply to the increased 

frequencies to the extent that those 

frequencies result in a significant net 

increase in seat capacity to the specific 

airport destination. (In other words, if a 

carrier adds frequency on smaller 

aircraft so that there is not a significant 

increase in seat capacity, the frequency 

increase would not be eligible for an 

incentive.) 

The FAA is not adopting the 

suggestion to expand the proposed 

definition of new service to incorporate 

one-stop service in addition to nonstop 

service. While the FAA understands 

that there may be some value in onestop service as a way for an air carrier 

to test a market, the value of one-stop 

service is significantly lower than 

nonstop service from a passenger’s 

perspective. In addition, the FAA is 

concerned that, in a predominantly huband-spoke aviation system, the different 

combinations and permutations of onestop service would make this very 

difficult to monitor. 

Seasonal Service: A4A and San Diego 

International Airport (SAN) both 

supported the proposed definition of 

seasonal service. However, DEN and the 

Greater Orlando Aviation Authority 

(MCO) commented that the 

International Air Transport Association 

(IATA) summer season lasts 

approximately seven months, from 

March to October and suggested that the 

FAA should define seasonal service as 

being offered less than seven months 

per year rather than six months, as in 

the proposed policy. 

The FAA agrees with the logic of 

matching IATA seasonal definitions and 

has modified the final policy to define 

seasonal service as nonstop service 

offered for less than seven months of the 

calendar year. 

New Entrant Carrier and Incumbent 

Carrier: ACI–NA objected to the 

proposed policy’s definition of ‘‘new 

entrants’’ on the grounds that there is a 

definitional gap between incumbent 

carriers (who are defined as ‘‘actively 

providing service’’) and new entrant 

carriers (who are defined as ‘‘not 

previously providing any air service’’) 

because a carrier could have provided 

air service to a particular airport in prior 

years, but not be actively flying to that 

airport. ACI–NA recommended that the 

FAA not define ‘‘new entrant carrier’’ 

and ‘‘incumbent carrier’’ in this policy 

and instead allow individual airport 

sponsors to define these terms in their 

ACIPs. ACI–NA also commented that 

some air carriers have recently begun 

serving smaller communities by 

contractual arrangement with bus 

companies and requested that such 

service be eligible for incentives if it 

sold by air carriers, even if it is not 

aeronautical. 

Two airport sponsors, TPA and the 

Port of Seattle (SEA), recommended 

modifying the new entrant definition so 

that new entrants can be considered 

carriers that are new to a particular 

market rather than a new carrier at a 

sponsor airport; several airports raised 

similar comments under the new service 

definition. 

The FAA’s intent in defining new 

entrants as carriers who were ‘‘not 

previously providing any air service’’ 

was that the new entrant carrier was not 

providing air service to the particular 

airport immediately prior to starting 

service. To clarify, the FAA has 

modified the final policy to use the 

word ‘‘currently’’ consistently to refer to 

the state of air service at the origin 

airport immediately prior to the 

execution of an incentive agreement 

(and has defined the term accordingly). 

In addition, the flexibility that the 

policy affords to airport sponsors 

regarding choosing whether to offer 

incentives for the restart of service that 

had previously been offered at the 

airport should help address the concern 

about the definitional gap. The FAA is 

not expanding the definition of carriers 

to include bus operators. Bus service is 

not considered to be aeronautical 

activity and is not ‘‘a local facility 

owned or operated by the airport owner 

or operator.’’ Accordingly, use of airport 

revenue and resources to incentivize 

bus service would be inconsistent with 

the requirements for the use of airport 

revenue. The FAA believes that the 

modifications in the final policy to 

allow incentives for incumbent carriers 

who add service in markets that they 

did not previously serve effectively 

address the comments from TPA and 

SEA on the new entrant definition. 

Preexisting Service: SAN commented 

that there should be a threshold of at 

least two flights per week on an 

annualized or a seasonal basis in order 

to qualify as preexisting service. MWAA 

commented that the seasonal service 

provisions should allow for a market to 

be considered unserved during the 

months that the seasonal service does 

not operate so that a carrier entering the 

market during the off-season could also 

receive incentives. 

The FAA believes that the 

modifications in the final policy to 

allow incentives for significant 

frequency increases on preexisting 

service obviates the justification for a 

minimum threshold for preexisting 

service, as airport sponsors may offer 

incentives for frequency increases, as 

long as they are consistent with the 

limitations of the final policy. The FAA 

has modified the definition of 

preexisting service to clarify that an 

airport destination served nonstop on a 

seasonal basis is considered not to be 

currently served nonstop in other 

months for the purposes of this policy. 

Other Clarifications: The FAA has 

made several other clarifications to the 

definitions and terminology throughout 

the policy. Based on several comments, 

the proposed policy may have been 

unclear at times when using the word 

‘‘airport’’ whether the policy was 

referring to the airport offering the 

incentive or the airport destination. 


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Therefore, the FAA has introduced and 

defined the term ‘‘origin airport’’ as the 

airport which is offering an incentive 

under an ACIP and clarified that 

references to the ‘‘airport sponsor’’ in 

the policy are to the sponsor of the 

origin airport. The final policy also 

defines ‘‘airport destination’’ as the 

airport receiving new service from the 

origin airport and uses that term 

consistently throughout the policy. 

In response to comments from ACI– 

NA, HAS and MWAA, the FAA has also 

clarified that it is permissible for ACIPs 

to define each airport within a 

metropolitan area as a separate airport 

destination. 

Finally, the FAA also re-ordered the 

definitions so that terms are in 

alphabetical order. 

C. Seasonal Service Applicability 

Three airport sponsors commented 

that they support the proposed policy’s 

provision that permits incentives for up 

to three years for new seasonal service 

to an airport destination that was 

previously unserved. AAAE generally 

supports increased flexibility for 

incentives for new seasonal service, but 

commented that the FAA should not be 

prescriptive in terms of defining the 

eligible timeframe. TPA commented that 

a two-year limit should be sufficient to 

establish a new seasonal service in the 

market. A4A commented that seasonal 

service incentive time limits should 

mirror time limits for other types of new 

service (two years for previously 

unserved markets and one year for new 

service in previously served markets). 

The FAA believes that the rationale 

for allowing incentives for seasonal 

service to continue for up to three years 

in order to build the market remains 

valid, and therefore has finalized this 

aspect of the policy as proposed. 

D. New Entrant Incentives 

The proposed policy reiterated the 

2010 Guidebook in stating that new 

entrants who begin nonstop service on 

a previously unserved route from the 

origin airport can receive incentives for 

up to two years, and that ACIPs may 

offer incentives to new entrant carriers 

for providing service to an airport 

destination with preexisting service, 

while excluding incumbent air carriers. 

In that case, the new entrant incentives 

are limited to no more than one year. 

PHX objected to the exclusion of 

incumbent carriers from incentives that 

a new entrant carrier would be eligible 

for, and stated that an airport should 

have flexibility to determine whether a 

destination should be eligible for 

incentives, rather than limit incentives 

based on whether the carrier is a new 

entrant. In addition, two commenters 

asked for clarification regarding this 

provision. TPA asked what happens if a 

second carrier begins nonstop service 

following the first entrant in the same 

market but within the two-year 

incentive period and specifically 

whether the first entrant would no 

longer be eligible for a two-year 

incentive. MCO asked about a similar 

scenario, but whether the second new 

entrant would also be eligible for two 

years of incentives if minimal time has 

passed between start dates. 

The FAA believes that the 

modifications to the new service 

definition would allow ACIPs to 

provide incentives to incumbent carriers 

who provide new service to an airport 

destination with preexisting service. 

However, the FAA has retained the new 

entrant language from the proposed 

policy, which gives airport sponsors 

latitude to limit incentives to new 

entrants on routes with preexisting 

service if they choose to do so, on the 

grounds that a new entrant carrier is 

temporarily not similarly situated to an 

incumbent carrier at the origin airport. 

Regarding the questions raised by 

TPA and MCO, the FAA’s interpretation 

is that a second new entrant into a given 

market would only be eligible for one 

year of incentives, as the airport 

destination in question would no longer 

be ‘‘not currently served nonstop from 

the origin airport.’’ The timeframe of 

incentives for the first new entrant 

would need to be addressed according 

to the airport sponsor’s ACIP and the 

contract with the carrier. As discussed 

below, the FAA encourages airport 

sponsors to define the criteria for the 

‘‘first air carrier to establish service’’ in 

their ACIPs in order to avoid disputes. 

E. Procedures If ACIP Has a Limited 

Budget 

ACI–NA, DEN, and SAN expressed 

support for the proposed policy’s 

provisions that permit airport sponsors 

of any size to limit incentives to one 

carrier in cases where the sponsor has 

a limited budget, provided that 

information regarding the ACIP, 

including the limited availability, is 

disclosed at least 30 days prior to 

signing a contract with a carrier. AAAE 

supports the flexibility to limit 

incentives but commented that the 

FAA’s proposed language on how to do 

so was too restrictive. 

A4A expressed general support for the 

disclosure provisions, along with 

concern that the proposal may be 

insufficient to prevent undisclosed 

dealings with a favored carrier. A4A 

recommended that the policy state that 

disclosure is a requirement rather than 

an expectation, that ‘‘posting’’ the ACIP 

on a website is insufficient and should 

be replaced by direct communication to 

carriers, and that an airport sponsor 

should not be allowed to commence 

individual carrier discussions regarding 

incentives under a limited ACIP until 

after the ACIP (including limitations) is 

disclosed. A4A also requested that the 

FAA clarify what it means to be the first 

carrier to ‘‘establish new service’’ or 

‘‘enter the market’’ because these may 

have different interpretations and 

pointed out that the proposed policy 

uses different phrasing in the New 

Service vs Preexisting Service compared 

to the New Entrant Carriers section. In 

contrast, ACI–NA recommended that 

the FAA leave the interpretation of 

these phrases to the reasonable 

discretion of airport sponsors. 

The FAA believes that the proposed 

policy generally strikes an appropriate 

balance between practicality and the 

benefits of disclosure. The FAA remains 

convinced that it is appropriate for 

disclosure to be an expectation rather 

than a requirement due to the nonregulatory nature of this policy. 

Regarding the definition of the ‘‘first 

carrier’’ that ‘‘establishes new service’’ 

or ‘‘enters the market,’’ the FAA agrees 

with A4A that the language should be 

more consistent between the two 

referenced sections of the policy 

(although not exactly the same because 

the sections are describing different 

cases). The final policy uses 

‘‘establishes service to the origin 

airport’’ in the New Entrant Carriers 

section. The FAA agrees with ACI–NA 

that the definition of establishing 

service is best left to individual airport 

sponsors rather than prescribed by the 

FAA; however, the FAA agrees with 

A4A that the criteria should be clearly 

defined and disclosed. Therefore, the 

final policy adds ‘‘criteria by which the 

first air carrier to establish service is 

determined’’ to what airport sponsors 

are expected to disclose at least 30 days 

prior to signing a contract with a carrier. 

Finally, in response to comments 

discussed in the ACIP Transparency 

section, and to be consistent with 

modifications made to that section of 

the policy to clarify that airport 

sponsors are not expected to disclose 

detailed air carrier incentives for 

specific routes in advance of signing a 

contract, the FAA has removed language 

about posting planned incentives as part 

of the disclosure expectations. 

F. Service Frequency 

The FAA received no comments on 

the proposed language to permit airport 

sponsors to allow different incentive 

levels for different frequencies of service 


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(e.g., three flights per week versus five 

flights per week), and has maintained 

this language in the final policy. 

The FAA has also expanded this 

section to describe the conditions under 

which an airport sponsor may choose to 

offer incentives for frequency increases 

on preexisting service, as detailed above 

under Definitions. 

G. Cargo Carriers 

A4A, AAAE, and DEN all expressed 

support for the proposed policy’s 

clarification that it is not unjustly 

discriminatory for an ACIP to 

distinguish between passenger and 

cargo carriers. The FAA has maintained 

this language in the final policy. 

H. Incentives Based on Number of 

Passengers or Seat-Miles 

ACI–NA, along with three individual 

airport sponsors, expressed support for 

the proposed policy regarding 

incentives that are based on the number 

of passengers or seat-miles flown on 

new service. SAN, while supporting the 

proposed policy, also commented that 

the FAA should also consider incentives 

on a per passenger basis relative to the 

proportion of total passengers that an 

incentivized airline carries at the 

airport. A4A expressed strong 

opposition to these types of incentives, 

alleging that they violate the Airline 

Deregulation Act (ADA), the FAA’s 

guiding principles on economic 

nondiscrimination, and the prohibition 

on use of airport revenues to subsidize 

air carriers. 

The FAA believes that the underlying 

rationale for these types of incentives, as 

discussed in the proposed policy, 

continues to justify incentives that vary 

based on passengers or seat-miles flown 

and that, provided that ACIPs are not 

restricted to particular aircraft types, 

these types of incentives do not violate 

the ADA or other restrictions. In 

addition, the FAA notes that in many 

cases airport charges increase based on 

the size of the aircraft or number of 

passengers carried, and the policy limits 

fee reductions to the charges that an air 

carrier would have otherwise incurred. 

The FAA has made minor wording 

changes to this section in the final 

policy to improve clarity. Based on the 

modification to the final policy to allow 

incentives for frequency increases, the 

FAA believes that the scenario outlined 

by SAN in its comment would generally 

be consistent with the policy, subject to 

review of a particular incentive for 

discriminatory effect. 

In the section on aircraft type, the 

FAA has clarified in the final policy that 

incentives based on specific aircraft 

types are unjustly discriminatory, in 

order to distinguish from incentives that 

vary based on the size of an aircraft. 

I. Incentives for Upgauging 

ACI–NA, AAAE, and eight individual 

airport sponsors expressed general 

support for upgauging incentives. 

Several of these individual airport 

sponsors suggested specific limitations. 

MCO and the Gerald R. Ford 

International Airport Authority (GRR) 

commented that incentives for 

upgauging should be permitted if there 

is a net increase in service offered. DEN 

suggested a minimum capacity increase 

threshold, such as 50 percent above the 

previous year, in order to qualify for an 

upgauging incentive and that airport 

sponsors should clearly designate 

markets that qualify. AMA similarly 

recommended limiting upgauging 

incentives to cases where the new 

aircraft has at least 50 percent more 

seats than the previous aircraft. In 

addition, AMA suggested restricting 

upgauging incentives so that upgauging 

cannot be the only incentive in the 

sponsor’s ACIP, upgauging cannot be 

the only incentive granted to a carrier 

for any specific incentive period, and 

the carrier receiving an upgauging 

incentive cannot contract its schedule in 

order to operate fewer flights with the 

larger aircraft or cancel other routes to 

the airport during the incentive period. 

SAN does not take a stance on 

upgauging incentives, but notes that 

upgauging could be a useful tool for 

airports in the future to maximize 

airfield capacity. 

A4A, ACI–NA, and TPA all noted that 

there is a link between upgauging and 

frequency additions on preexisting 

service, in that both represent capacity 

increases in markets that are already 

served, and therefore they should be 

treated consistently. ACI–NA and TPA 

asserted that incentives should be 

permitted in both cases. A4A stated that 

upgauging does not fit the definition of 

new service in the policy as proposed. 

However, A4A added that if the FAA 

does not adopt the previously proposed 

definition of new service, then A4A 

takes no position on whether incentives 

for upgauging should be permitted, as 

their members have different views on 

the issue. 

The FAA agrees with the commenters 

that there should be consistency in the 

treatment of increased capacity in 

markets that are already served. 

Therefore, in the final policy, the FAA 

adopts similar language for upgauging 

as described for frequency additions 

above, which also incorporates many of 

the suggestions from AMA, DEN, GRR, 

and MCO. Specifically, if upgauging 

incentives are permitted as part of a 

sponsor’s ACIP, those incentives are 

limited to one year, and cannot be the 

only incentive in the sponsor’s ACIP. In 

addition, in order to receive incentives, 

the upgauging must result in a 

significant net increase in seat capacity 

to the airport destination involved. As 

in the case of incentives for frequency 

increases, the FAA is leaving the 

definition of ‘‘significant’’ to each 

airport sponsor to articulate in its ACIP 

based on local circumstances, but 

encourages sponsors who choose to 

offer incentives for upgauging to 

consider defining a threshold 

percentage increase in order to qualify 

for incentives. The FAA is not adopting 

AMA’s suggested restriction that 

upgauging cannot be the only incentive 

granted to a carrier for any specific 

incentive period, but notes that an 

airport sponsor could choose to add that 

provision in its published ACIP if 

deemed appropriate for its local 

circumstances. 

J. Legacy vs Low-Cost Carriers 

The FAA received no comments 

regarding the proposed provision to 

prohibit ACIPs from targeting carriers 

with particular types of business models 

or being designed for a preferred carrier; 

the final policy adopts this provision as 

proposed with one minor clarifying 

change. 

K. ACIP Transparency 

A4A and five individual airport 

sponsors expressed general support for 

the proposed policy’s provisions 

regarding ACIP transparency. However, 

several of these commenters also gave 

specific suggestions for modifications in 

this area. A4A recommended that the 

policy state that disclosure is a 

requirement rather than an expectation 

and that the airport sponsor be required 

to provide direct notification to the air 

carriers through their designated airport 

affairs representative, as posting the 

ACIP on the airport sponsor’s public 

website or notifying industry trade 

groups may not constitute sufficient 

notification. A4A also recommended 

expansion of the provision regarding 

airport sponsors providing the necessary 

financial documentation to demonstrate 

that there is no cross-charging and that 

an ACIP has no effect on rates and 

charges of other aeronautical users. A4A 

stated that the only way to demonstrate 

that landing fee and terminal rental 

waivers meet these requirements is for 

the airport sponsor to include the 

associated landed weight and/or 

terminal space in the rates and charges 

calculation along with an associated 

credit for the waived fees, and also 

suggested the addition of language 


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specifying that an ACIP may not reduce 

payments or credits that a nonincentivized carrier would otherwise 

receive from the airport sponsor in the 

absence of the incentivized service. 

While supporting most of the 

transparency provisions, three airport 

sponsors raised concerns that the 

proposed policy could be interpreted as 

calling for airport sponsors to provide 

advanced notice of each specific 

incentive agreement with an air carrier, 

which may be impractical and raises 

competitive issues. ACI–NA and several 

other airport sponsors also raised 

concerns or questions regarding this 

issue. While expressing general support 

for transparency, West Virginia 

International Yeager Airport (CRW) 

requested that the final policy clarify 

that the airport sponsor may negotiate 

and adjust the published ACIPs on a 

case-by-case basis (so long as the agreedto elements of the incentives comply 

with the ACIP policy), depending on the 

needs of the airline and the airport for 

the new service offered. 

ACI–NA, AAAE and five individual 

airport sponsors generally objected to 

the transparency policy as proposed. 

Most of these commenters expressed 

concern that the public disclosure 

provisions were overly burdensome, in 

some cases impractical, and 

unnecessary because the information is 

in many cases already publicly available 

or would be obtainable through a public 

records request. Several of these 

commenters suggested eliminating the 

transparency section entirely and 

allowing airport sponsors to determine 

what and when to disclose. ACI–NA 

expressed support for the public notice 

not being an ‘‘absolute requirement.’’ 

Several stakeholders also raised 

clarifying questions regarding the 

interpretation of proposed provisions 

regarding ACIP transparency. A4A 

requested clarification on whether the 

transparency provisions are intended to 

apply to air carriers as well as the 

public, noting potential inconsistent use 

of terms in the proposed policy. DEN 

requested clarification as to whether the 

policy calls for airport sponsors to post 

incentives actually granted under 

incentive agreements with carriers or 

incentives dispersed, since these may 

not be the same thing. TPA requested 

that the FAA provide a more specific 

definition of ‘‘periodic’’ in terms of how 

frequently airport sponsors should post 

listings of carriers benefiting from 

incentives. TPA also inquired whether 

full incentive agreements and the 

financial documentation need to be 

published as public notice documents. 

The FAA believes that increased 

transparency is a necessary element in 

the policy, both in terms of public 

availability before an ACIP is 

implemented and disclosure once it is 

in effect, because the transparency helps 

to ensure compliance with Grant 

Assurances 22, 23, 24, and 25 and 

related policies, including Rates and 

Charges and Revenue Use. The policy 

attempts to strike a balance of setting an 

expectation of reasonable disclosure 

without being overly burdensome. The 

final policy largely adopts the proposed 

policy in this area with some 

clarifications. 

The intent of the policy is that airport 

sponsors disclose the existence of an 

ACIP and its terms and conditions at 

least 30 days in advance of signing an 

incentive agreement with a carrier so 

that all carriers are aware of the 

existence of an incentive program and 

have an opportunity to participate or 

raise concerns. However, there is not an 

expectation for advance notice of a 

specific incentive agreement because, as 

noted in several comments, such notice 

would potentially prematurely disclose 

competitive commercial information. 

Such information would be published 

periodically on a retroactive basis. 

Therefore, the FAA has added a clause 

in the final policy to clarify that 

advance notice of specific incentive 

agreements is not expected as long as 

those agreements comply with the terms 

and conditions of the previously 

published ACIP. The FAA notes that if 

an airport sponsor were to adjust the 

published ACIP as a result of 

negotiations with a particular air carrier 

so that the terms would be different 

than those previously published, the 

FAA’s expectation would be that the 

airport sponsor would publish the 

revised terms of conditions of its ACIP 

at least 30 days prior to signing an 

incentive agreement. Such a 

modification of the terms of an ACIP for 

a specific carrier without notice would 

potentially raise concerns of unjust 

discrimination. 

In response to one of A4A’s 

comments, the FAA is adding language 

to the third guiding principle to clarify 

that non-incentivized carriers may not 

be charged ‘‘directly or indirectly’’ for 

the costs of an ACIP unless all nonparticipating carriers agree. 

The FAA remains convinced that it is 

appropriate for disclosure to be an 

expectation rather than a regulatory 

requirement due to the non-regulatory 

nature of this policy. The FAA believes 

that posting an ACIP on an airport 

sponsor’s public website or providing 

information through appropriate 

industry trade groups likely provides 

broader notice than communicating an 

ACIP through the designated airport 

affairs representative; notification 

through the airport affairs representative 

may provide effective notice to 

incumbent carriers serving the airport, 

but may not reach potential new entrant 

carriers, who would also be interested 

parties. 

Regarding A4A’s comments 

requesting clarification, the 

transparency provisions are primarily 

intended to apply to airport sponsors 

disclosing information to air carriers, 

although the information should be 

available to the broadest possible 

universe of carriers (i.e., those who 

currently serve the airport and those 

who do not). To avoid confusion, the 

final policy deletes the phrase ‘‘for the 

public’’ from the first clause of the 

proposed policy on ACIP transparency. 

In response to DEN’s question about 

whether airport sponsors are expected 

to post incentives granted or actual 

dispersed funds, the policy does set 

expectations of posting the incentives 

granted undersigned agreements, 

although nothing prevents an airport 

sponsor from also disclosing the actual 

dispersed funds if the sponsor believes 

that doing so would provide a more 

complete picture. A sponsor may also 

have separate obligations to disclose 

rate information to incumbent carriers. 

Regarding TPA’s request for a more 

specific definition of ‘‘periodic,’’ the 

FAA expects each airport sponsor to 

determine a reasonable frequency for 

publishing this information, given that a 

‘‘one size fits all’’ solution is likely not 

appropriate as incentive programs may 

be utilized differently at different 

airports. Similarly, in response to TPA’s 

inquiry about whether documents must 

be published as public notice 

documents, the FAA is not prescribing 

particular means of issuing notice and 

recognizes that local public information 

requirements may vary, but whatever 

means are used must be effective in 

advising carriers potentially eligible for 

or affected by the ACIP of its existence. 

L. Subsidies/Third-Party Costs 

ACI–NA, GRR, and the Port Authority 

of New York and New Jersey (PANYNJ) 

expressed opposition to the proposed 

policy’s statement that ‘‘a waiver or 

assumption of costs that would 

normally be charged by a third party 

(ground handling, fuel, etc.) would be 

considered a subsidy and is not 

permissible for an ACIP.’’ ACI–NA 

commented that ‘‘costs that would 

normally be charged by a third party’’ 

has different meanings at different 

airports and states that the airport 

sponsor should be able to waive costs 

such as ground handling or fuel service 

fees under an ACIP when the sponsor is 


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the sole provider of those services at the 

airport. ACI–NA and PANYNJ suggested 

that airport sponsors should be able to 

waive fees that the sponsor charges to 

third parties that are then passed on to 

air carriers. GRR commented that 

several successful incentive programs 

have included ground handling waivers 

and airport sponsors should have 

flexibility to provide such a waiver if/ 

when appropriate. 

The final policy makes no changes to 

the proposed policy in this area. The 

FAA is concerned that permitting 

waivers of charges for ground handling 

by a commercial operator would cross a 

line into subsidies prohibited by the 

requirements for use of airport revenue. 

Allowing the sponsor to pay these 

charges would also potentially result in 

inequitable treatment across airports 

depending on whether the airport 

sponsor is the sole provider of ground 

handling services. Therefore, the final 

policy maintains the prohibition on 

including costs that are normally 

charged by a third party, with ‘‘normal’’ 

having the meaning of standard practice 

industrywide. 

M. Airport v. Non-Airport Revenues and 

Technical Assistance 

A4A, AAAE, ACI–NA, and five 

individual airport sponsors expressed 

general support for the FAA’s proposed 

policy regarding distinctions between 

airport revenues and non-airport 

revenues, including the proposal that 

airport staff be permitted to provide 

certain types of technical assistance to 

non-airport entities regarding ACIPs that 

do not use airport revenue, which 

represents a change to the 2010 

Guidebook. 

A4A commented that the policy 

should be modified to have airport staff 

disclose the details of their technical 

assistance to the air carrier airport 

affairs representative (or designee), and 

to clarify that the policy prohibits 

airport staff from handling or comingling non-airport funds. ACI–NA, 

AAAE and the Cedar Rapids Airport 

Commission (CID) commented that the 

policy should not list three specific 

types of technical assistance that airport 

staff can provide, should include an 

expanded list, or should clarify that the 

list is a non-exhaustive set of examples. 

AAAE also commented that many of its 

members believe that the policy should 

be modified to allow airport staff to 

participate in decision-making 

processes (including voting) regarding 

non-airport ACIPs and/or handle nonairport funds in certain limited 

circumstances. CRW requested that the 

FAA clarify that the term ‘‘local’’ as 

used throughout the policy includes 

programs sponsored by state 

governments and other non-federal 

entities. 

In the final policy, the FAA has 

updated references to ‘‘local’’ 

governments to include state and other 

non-federal entities. In addition, the 

final policy explicitly clarifies that 

airport staff may not have responsibility 

for the handling and disposition of nonairport funds. The FAA did not adopt 

the suggestion to set an expectation that 

airport staff disclose the details of their 

technical assistance to their air carrier 

airport affairs representative, as doing so 

could reveal confidential commercial 

information. The FAA believes that 

having airport staff participate in 

decision-making processes or handle 

non-airport funds crosses the line 

between technical assistance and active 

participation and therefore the final 

policy continues to prohibit these 

activities. The FAA also believes that it 

is helpful to list types of technical 

assistance that are permitted and notes 

that these are fairly broad categories that 

encompass the longer list of examples of 

technical assistance that were included 

in ACI–NA’s comment. The final policy 

therefore maintains this listing. 

However, the FAA has added text to 

clarify that other similar types of 

technical assistance consistent with the 

intent and parameters of this section are 

also permitted. 

N. Marketing Incentives 

A4A, AAAE, ACI–NA, and 13 

individual airport sponsors commented 

that the FAA’s proposal to prohibit 

airport sponsors from transferring 

marketing incentive funds to a carrier 

was infeasible and inconsistent with 

industry practice for how marketing 

programs are executed. Several of these 

commenters stated that it would be 

impractical for airport sponsors, 

particularly as public entities, to 

execute individual contracts with 

marketing service providers, as called 

for under the proposed policy. Many 

commenters suggested alternate 

approaches that are closer to current 

practice and would permit airport 

sponsors to transfer marketing incentive 

funds to a carrier provided that there is 

appropriate documentation of the 

expenditures. PANYNJ suggested that in 

order for an airport sponsor to transfer 

marketing ACIP funds directly to an air 

carrier, the sponsor should maintain 

sufficient documentation that 

demonstrates that funds would be used 

only for approved marketing activities 

and that those funds are not transferred 

until after services have been rendered. 

The FAA appreciates the unified 

insight from the industry on this issue 

and believes that PANYNJ’s suggestion 

strikes an appropriate balance between 

practicality and ensuring that prohibited 

subsidies are avoided. The final policy 

incorporates the suggested language 

describing the requisite documentation 

to support the payment of marketing 

funds directly to an air carrier. 

O. Incentives for Individual Travelers 

The FAA received no comments 

regarding the proposed provision; the 

final policy adopts this provision as 

proposed. 

P. Charges for Non-Participating 

Carriers 

A4A expressed support for the 

proposed policy’s provision that an 

ACIP may not increase fees charged to 

non-participating carriers or other 

aeronautical users and tenants of the 

airport subject to the requirement for 

reasonable fees under 49 U.S.C. 

47107(a)(1) and Grant Assurance 22. 

A4A provided a recommendation to 

clarify that an ACIP may not reduce 

payments or credits that would 

otherwise be received from the airport 

sponsor in the absence of the 

incentivized service because cash 

payments are not always provided to air 

carriers. 

The FAA has incorporated the 

proposed clarification into the final 

policy, as this is consistent with the 

intent of the policy language. 

Q. Self-Sustaining Rate Structure 

The FAA received no comments 

regarding the proposed provision; the 

final policy adopts this provision as 

proposed. 

R. Restart of Previous Service 

AAAE, ACI–NA, PANYNJ, and SAN 

all expressed general support for the 

proposed policy’s provision to permit 

airport sponsors to use their own 

discretion when choosing whether to 

offer incentives for a carrier to restart 

service that the same carrier had offered 

previously but cancelled due to 

significant external circumstances or 

poor route performance, with examples 

of the COVID–19 pandemic or the 9/11 

terrorist attacks provided as 

circumstances where such flexibility 

would be helpful. A4A expressed 

conceptual support of the discretion to 

provide incentives to restart service that 

ended due to significant external 

circumstances but opposition to the 

inclusion of poor route performance as 

a justification, on the grounds that this 

raises concerns of unjust discrimination 

and potential abuse by an air carrier. 

A4A also recommended that the policy 

include specific waiting periods in 


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order to qualify for incentives related to 

the restart of service. DEN also 

requested more specific guidelines in 

this area, and expressed concern that 

leaving incentives for the restart of 

service to the discretion of individual 

airport sponsors may put some airports 

at a competitive disadvantage due to 

varying interpretations. 

The FAA has made two modifications 

to the final policy as a result of the 

comments. The FAA’s intent was that 

this flexibility would be exercised in the 

aftermath of extraordinary external 

events such as natural or manmade 

disasters, including (for example) the 

COVID–19 pandemic. To convey this, 

the final policy refers to ‘‘extraordinary’’ 

external circumstances rather than 

‘‘significant,’’ and eliminates the 

reference to ‘‘poor route performance in 

past years’’ as a justification for an 

airport sponsor to offer incentives for 

the restart of previously cancelled 

service. After this adjustment, the FAA 

believes it is not necessary to add a 

specific waiting period or further 

guidelines regarding the 

implementation of incentives for the 

restart of previous service, given that the 

impact of an extraordinary external 

circumstance may vary depending on 

the event and may be quite different in 

different locations. Therefore, airport 

sponsors should have flexibility to 

implement such an incentive if they 

choose to do so based on their 

individual circumstances, as long as it 

is consistent with other provisions in 

the final policy (including the limits on 

the length of time an incentive can be 

in effect). 

S. FAA Review of ACIPs 

The proposed policy stated that the 

FAA will review an ACIP for 

compliance with an airport sponsor’s 

Federal obligations if the airport 

sponsor requests such a review, but that 

the agency does not approve ACIPs. 

A4A commented that air carriers should 

also be permitted to request that the 

FAA review an airport sponsor’s ACIP. 

HAS commented that if an airport 

sponsor seeks FAA’s input on an ACIP, 

the agency should provide either 

approval or a detailed explanation of 

what specifically needs to be changed. 

DEN recommended that the FAA 

develop and implement a mechanism 

for airport sponsors to request formal 

written approval that a proposed ACIP 

is consistent with the five general 

principles of acceptable ACIPs. 

The FAA agrees that it would be 

appropriate for an air carrier to request 

FAA review of an ACIP and notes that 

this informal review could reduce the 

likelihood of more formal disputes; 

therefore, the final policy permits a 

potentially affected air carrier to request 

FAA review of an ACIP. While the FAA 

does not formally approve ACIPs, the 

agency would provide feedback on 

whether the ACIP appears to be in line 

with Grant Assurances and will provide 

recommendations for modification if 

appropriate. The FAA also notes that 

ACIPs are typically reviewed as part of 

the agency’s regular airport financial 

reviews. 

T. Existing Incentives/Effective Date 

SAN expressed support for the 

proposed policy’s provision allowing 

existing ACIPs that complied with the 

2010 Guidebook to sunset as programs 

compliant with the new policy are 

brought online. DEN commented that it 

would be better for the FAA to set a firm 

date when the final policy would be 

effective and noted that airports would 

need at least 60 days’ notice from the 

date of publication of a final policy in 

order to provide time to revise and gain 

internal approval of the revised ACIP 

and provide the requisite 30 day notice 

to air carriers. PHX noted that the FAA 

should allow ample time for airports to 

respond to proposed changes and 

implement them, given that the ACIP 

guidance has remained unchanged since 

2010. 

The FAA recognizes DEN’s comment 

about the logistics involved in revising 

an ACIP and posting it for 30 days in 

compliance with this policy. At the 

same time, FAA believes it is important 

to minimize the transition period. 

Therefore, the agency has modified the 

final policy so that incentive agreements 

contracted under ACIPs 60 days or more 

after the issuance date must comply 

with the new policy. The agency notes 

that any specific incentive agreements 

contracted prior to that point under 

ACIPs that were in effect prior to this 

new policy being issued should comply 

with the 2010 Guidebook and all grant 

assurances and other FAA policies. The 

FAA has also clarified that the relevant 

date is when the contract is signed, as 

the terms ‘‘initiated’’ and ‘‘provided’’ 

may have been unclear. Finally, the 

FAA has clarified that any new ACIP or 

modification to an existing ACIP (as 

opposed to a specific incentive 

agreement under an ACIP that was 

already in effect) after the issuance of 

this new policy must comply with the 

new policy (i.e., without a 60-day grace 

period). 

U. Other Topics/Miscellaneous 

CRW commented that the FAA should 

provide clarification as to the 

circumstances when a sponsor can use 

airport funds as a SCASDP match 

without violating Grant Assurance 25. 

The relationship of SCASDP to FAA 

grant assurances and the Revenue Use 

Policy is discussed in Section C. 

(Related Federal Programs) under the 

Background section of this document. 

CID’s comments raised the question of 

whether those portions of the 2010 

Guidebook not addressed in the updated 

policy will continue to apply. The FAA 

reiterates that the updated policy 

entirely supersedes the 2010 Guidebook. 

A4A suggested that FAA consider 

developing a supplemental document, 

such as a frequently asked questions 

(FAQs) or quick reference guide, in 

conjunction with the final policy. The 

FAA will consider developing such a 

document on an as-needed basis. 

ACI–NA requested that the FAA allow 

incentives based on time of day to allow 

airport sponsors to provide incentives to 

air carriers to fly at off-peak times. The 

FAA believes that the suggestion by 

ACI–NA is effectively a congestion 

management program using airport fees. 

As such, it is outside the scope of this 

policy. 

Exhaustless, Inc., objected to what it 

characterizes as FAA and State 

interference in the open, competitive 

market for air transportation. 

Exhaustless recommended that all 

states, airports, cities, and any other 

governmental entity stop all activity to 

subsidize air carriers to comply with 

various laws and air transport 

agreements. The FAA notes that air 

service incentives are standard practice 

within the aviation industry, including 

in other countries. Incentives offered by 

airport sponsors are intended to be 

temporary and justified on the basis of 

unique issues associated with the startup of new air service. No changes to the 

policy were adopted in response to this 

comment. 

MWAA commented that the FAA 

should engage in more meaningful 

dialogue with airport sponsors, and that 

a 60-day comment period is insufficient 

for sponsors to provide meaningful 

input. The FAA disagrees with this 

comment and notes that the 

development of the draft policy 

included discussions with industry 

stakeholders. FAA chose to engage in a 

formal public comment process and 

believes that the 60-day comment 

period is sufficient given the scope of 

the policy. 

IV. Availability of Documents 

A. Policy Documents 

You can get an electronic copy of this 

policy using the internet by: 


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(1) Searching the Federal 

eRulemaking portal 

(www.regulations.gov); 

(2) Visiting FAA’s Regulations and 

Policies web page at (https://

www.faa.gov/regulations_policies; or 

(3) Accessing the Government 

Printing Office’s web page at (heep://

www.gpoaccess.gov/index.html). 

You can also get a copy by sending a 

request to the Federal Aviation 

Administration, Office of Airport 

Compliance and Management Analysis, 

800 Independence Avenue SW, 

Washington, DC 20591, or by calling 

(202) 267–3085. Make sure to identify 

the docket number, notice number, or 

amendment number of this proceeding. 

B. Comments Submitted to the Docket 

Comments received may be viewed by 

going to https://www.regulations.gov 

and following the online instructions to 

search the docket number for this 

action. Anyone is able to search the 

electronic form of all comments 

received into any of the FAA’s dockets 

by the name of the individual 

submitting the comment (or signing the 

comment, if submitted on behalf of an 

association, business, labor union, etc.). 

C. Small Business Regulatory 

Enforcement Fairness Act 

The Small Business Regulatory 

Enforcement Fairness Act (SBREFA) of 

1996 requires the FAA to comply with 

small entity requests for information or 

advice about compliance with statutes 

and regulations within its jurisdiction. 

A small entity with questions regarding 

this document may contact its local 

FAA official, or the person listed under 

the FOR FURTHER INFORMATION CONTACT

heading at the beginning of the 

preamble. To find out more about 

SBREFA on the internet, visit https://

www.faa.gov/regulations_policies/ 

rulemaking/sbre_act/. 

The Policy 

In consideration of the foregoing, the 

FAA issues the following statement of 

policy on air carrier incentive programs, 

to supersede the Air Carrier Incentive 

Program Guidebook issued in 2010. 

Air Carrier Incentive Programs 

Many U.S. airport sponsors have 

found it beneficial to encourage new air 

service and new carriers at their airports 

by offering air carrier incentive 

programs (ACIPs), in the form of 

reductions or waivers of airport charges, 

and/or support for marketing new 

service. 

ACIPs represent a limited exception 

to the general rule stated in Grant 

Assurance 22 paragraph 22.e., 

guaranteeing all carriers nondiscriminatory and equivalent rates and 

charges for each carrier’s category. FAA 

has reconciled this exception with the 

general rule on the understanding that 

a new carrier operating at an airport, or 

a carrier starting a new route, operates 

at a disadvantage with established 

carriers until the new service becomes 

known and accepted. In that sense, the 

carrier operating new service is not 

similarly situated to established carriers, 

and a sponsor may reduce charges to the 

new service carrier in some 

circumstances, for a limited time, 

without violating Grant Assurances 22, 

23, 24, or 25. 

In considering whether an ACIP 

complies with a sponsor’s Federal grant 

agreements, the FAA will apply these 

general principles to the particular 

elements of the ACIP: 

• Discrimination between carriers 

participating in an ACIP and nonparticipating carriers must be justified 

and time-limited. Differences in airport 

charges for carriers under an ACIP from 

those charged to other carriers at an 

airport must not be unjustly 

discriminatory. Differences in charges 

must be justified by differences in the 

carriers’ costs of starting and marketing 

new service at the airport and must be 

temporary. 

• A sponsor may not use airport 

revenues to subsidize air carriers. Using 

airport revenue for cash payments and 

other forms of subsidy for a carrier 

providing new service is considered 

revenue diversion and is therefore 

prohibited by grant agreements and 

Federal law. Fee reductions, fee 

waivers, and marketing assistance as 

incentives to new service are permitted 

to the extent described in the Policy and 

Procedures Concerning the Use of 

Airport Revenue. 

• A sponsor may not cross-charge 

non-participating carriers or other 

aeronautical users to subsidize ACIP 

carriers. Carriers not participating in an 

ACIP may not be charged directly or 

indirectly for the costs of the ACIP or for 

airport costs left uncovered as a result 

of the reduction or waiver of charges for 

an ACIP carrier, unless all nonparticipating carriers agree. 

• The terms of an ACIP should be 

made public. Publishing the intent to 

implement an ACIP, as well as 

information on how the ACIP is being 

used, ensures all eligible carriers are 

aware of the program, allows 

nonparticipating operators to review the 

potential effect of the ACIP on standard 

airport rates and charges, and minimizes 

the grounds for complaints of unjust 

discrimination. 

• Use of airport funds for an ACIP 

must not adversely affect airport 

operations or maintenance. A sponsor 

adopting an ACIP must maintain a selfsustaining rate structure that continues 

to provide funds for necessary 

operations and maintenance 

responsibilities, without increasing rates 

charged to non-participating operators. 

Guidance on particular program 

elements in this policy applies generally 

to each of those elements. For variations 

on those elements, or program elements 

not specifically addressed in this 

guidance, the above five principles will 

govern the agency’s ultimate 

determination of whether a particular 

ACIP is consistent with the sponsor’s 

AIP Grant Assurances. 

I. Definitions 

A. Airport destination: The airport 

receiving new service from the origin 

airport. Each airport within a 

metropolitan area may be defined as a 

separate airport destination for purposes 

of this policy. 

B. Currently: For the purposes of this 

policy, ‘‘currently’’ means the time 

immediately prior to the signing of an 

incentive agreement. 

C. Incumbent Carrier: An air carrier 

currently providing air service to the 

origin airport. 

D. New Entrant Carrier: An air carrier 

that is not currently providing any air 

service to the origin airport. 

E. New Service: 

1. Any nonstop service to an airport 

destination not currently served with 

nonstop service from the origin airport; 

2. Any service to the origin airport by 

a new entrant carrier; or 

3. A significant increase in capacity 

on preexisting service to a specific 

airport destination. 

F. Origin airport: The airport that is 

providing an incentive under an ACIP. 

For the purposes of this policy, the 

‘‘airport sponsor’’ is the sponsor of the 

origin airport. 

G. Preexisting service: Service to any 

airport destination that is currently 

served nonstop from the origin airport. 

An airport destination served nonstop 

only in one season is considered not 

currently served nonstop during the offseason. 

H. Seasonal Service: Nonstop service 

that is offered for less than 7 months of 

the calendar year. 


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II. An ACIP May Contain Any of 

Several Elements That Do Not Unjustly 

Discriminate Against Non-Participating 

Carriers, Consistent With Grant 

Assurances 22 and 23 

A. New Service v. Preexisting Service 

1. Limiting an incentive to new 

service is not in itself unjust 

discrimination. Incentives for flights to 

an airport destination not currently 

served with nonstop service may be 

provided for up to two years. 

2. New seasonal services (to an airport 

destination not currently served) are 

allowed to receive incentives for 3 

seasons of service, up to 3 consecutive 

years from the start of the incentive. 

3. Generally, new service incentives 

must be available to all carriers offering 

new service on the same basis but are 

subject to the distinctions permitted 

under other paragraphs in Section II of 

this policy. 

a. However, airport sponsors are 

allowed to restrict incentives for new 

service if they have a limited budget. 

Airport sponsors are allowed to restrict 

incentives to one carrier if they have 

disclosed to all carriers that they are 

limiting incentives to only the first air 

carrier that establishes new service. 

b. Airport sponsors are expected to 

provide public notification of the 

availability of an ACIP, including any 

limits on availability and criteria by 

which the first air carrier to establish 

service is determined, for a minimum of 

30 days before signing a contract with 

a carrier. 

B. New Entrant Carriers 

1. Incentives for a new entrant carrier 

on nonstop service to an airport 

destination that is not currently served 

nonstop from the origin airport can be 

provided for up to two years. 

2. Incentives can be offered to new 

entrant carriers for providing service to 

an airport destination with preexisting 

service, while excluding incumbent air 

carriers. In that case, the new entrant 

incentives are limited to no more than 

one year. After one year, the new 

entrant would be considered an 

incumbent air carrier, and similarly 

situated to other carriers at the airport. 

This applies to new entrants providing 

seasonal service as well as those 

providing year-round service. 

3. Generally, new entrant incentives 

must be available to all new entrant 

carriers on the same basis. The ACIP 

may not select one new entrant and 

deny the program to another new 

entrant. 

a. However, if an airport sponsor has 

a limited budget and has disclosed to all 

carriers that they are restricting 

incentives to only the first new entrant 

that establishes service to the origin 

airport, then the airport sponsor is 

allowed to limit incentives to one 

carrier. 

b. Airport sponsors are expected to 

provide public notification of the 

availability of an ACIP, including any 

limits on availability and criteria by 

which the first air carrier to establish 

service is determined, for a minimum of 

30 days before signing a contract with 

a carrier. 

C. Service Frequency 

1. It is not unjustly discriminatory to 

offer different levels of incentives for 

different frequencies of service (i.e., 

daily versus less than daily). For 

example, incentives typically offered for 

5 days a week service can be discounted 

40% for 3 days a week service. 

2. If an airport sponsor offers 

incentives for increased frequencies on 

preexisting service, these incentives are 

limited to no more than one year. If 

offered, this incentive must be made 

available to any carrier adding 

frequencies to the airport destination, 

regardless of whether the carrier 

previously provided nonstop service to 

that airport destination. 

a. Incentives for increased frequencies 

on preexisting service are considered 

supplemental to other incentives and 

cannot be the only incentive in the 

sponsor’s ACIP. 

b. Incentives should only apply to the 

increased frequencies to the extent that 

those frequencies result in a significant 

net increase in seat capacity to the 

specific airport destination. 

D. Cargo Carriers 

1. It is not unjustly discriminatory for 

incentives to distinguish between 

passenger and cargo carriers. 

E. Per-Passenger and Per-Seat Mile 

Incentives 

1. Incentives that vary on a per 

passenger or per seat-mile basis are not 

inherently unjustly discriminatory, but 

the airport sponsor should ensure that 

the incentives offered would not be 

considered a subsidy and would not 

result in unjust discrimination against 

non-participating carriers. 

2. The total value of fee reductions 

offered as an incentive on a per 

passenger or per seat-mile basis cannot 

exceed the amount of the fees that 

otherwise would have been incurred by 

a carrier for its operations at the airport. 

F. Aircraft Type 

1. Incentives based on specific aircraft 

types are unjustly discriminatory 

because they could unreasonably 

exclude certain carriers that do not 

operate the type of aircraft identified. 

2. Incentives for upgauging, to the 

extent they are allowed as a significant 

increase in capacity on a preexisting 

route, must be structured to avoid 

limitation to a particular aircraft type or 

types and are limited to no more than 

one year. 

a. Incentives for upgauging on 

preexisting service are considered 

supplemental to other incentives and 

cannot be the only incentive in the 

sponsor’s ACIP. 

b. Upgauging incentives should only 

apply to the increased capacity if there 

is a significant net increase in seat 

capacity to the specific airport 

destination. 

G. Legacy v. Low-Cost Carriers 

1. Incentives cannot target carriers 

with particular types of business models 

(e.g., legacy versus low-cost carriers), 

nor should they be designed for a 

preferred carrier. 

H. ACIP Transparency 

1. The FAA expects airport sponsors 

to provide effective notification of the 

availability and implementation of 

ACIPs to both incumbent and potential 

new entrant carriers (e.g., posting on an 

airport sponsor’s public website; 

notification to industry trade groups). 

Information posted should include the 

incentives offered; the program 

eligibility criteria; identification of new 

service; and for incentives awarded, a 

periodic listing of all carriers benefiting 

from the ACIP, the incentives received, 

and identification of the incentivized 

service. 

2. An airport sponsor is expected to 

provide effective public notice of an 

ACIP at least 30 days before signing an 

agreement with a carrier to implement 

an incentive. 

3. Advance public notice is not 

expected of a specific incentive 

agreement with a carrier as long as the 

agreement is consistent with the 

previously publicized ACIP. Lists of 

specific incentive agreements should be 

published periodically as described in 

paragraph H.1. 

4. To ensure transparency, an ACIP 

agreement should be a standalone 

document, consistent with the 

published ACIP information, and not 

embedded with any other agreement the 

airport sponsor and the carrier may 

enter into, such as a lease or operating 

agreement. 

5. Airport sponsors should make 

information on funding for any ACIP 

available to all aeronautical users at the 

airport, and sponsors should be ready to 

provide the necessary financial 


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documentation to demonstrate that 

there is no cross-charging and that the 

program has no effect on rates and 

charges of other aeronautical users. 

III. An ACIP May Not Include Direct or 

Indirect Subsidies of Air Carriers, as 

Prohibited by 49 U.S.C. 47133 and 49 

U.S.C. 47107, and Grant Assurance 25 

A. Incentives v. Subsidies 

1. A subsidy occurs when airport 

funds flow, under all circumstances or 

conditionally, to a carrier with no goods 

or services being provided to the airport 

in return. For this purpose, air service 

is not considered a ‘‘service’’ provided 

to the airport. Any incentives where 

airport funds or assets (e.g., fuel) are 

transferred to a carrier, directly or 

indirectly (e.g., revenue or loan 

guarantees) would be regarded as 

prohibited subsidies. 

2. A waiver of costs that an airport 

sponsor would otherwise charge a 

carrier (e.g., landing fees or terminal 

rents) is not considered a subsidy, if for 

a limited duration consistent with the 

policies above. However, a waiver or 

assumption of costs that would 

normally be charged by a third party 

(ground handling, fuel, etc.) would be 

considered a subsidy and is not 

permissible for an ACIP. Incentives tied 

to specific customer service metrics (ontime performance, luggage delivery, etc.) 

are also not permissible. 

B. Airport v. Non-Airport Revenues and 

Application to Subsidies and Other 

Revenue Guarantees 

1. Airport sponsors are prohibited 

from using airport funds to subsidize air 

carrier operations. 

2. A sponsor local government, state 

government, or other non-Federal 

airport sponsor may use non-airport 

funds for subsidies and other uses that 

would be prohibited if airport funds 

were used. However, any use of funds 

would still need to meet Grant 

Assurance obligations prohibiting 

unjust discrimination. 

3. Local and state governments and 

community organizations not party to 

an AIP grant agreement, however, can 

use non-airport funds for incentives that 

would not be permissible for an 

obligated airport sponsor, including 

directing incentives toward a specific 

carrier and using their non-airport funds 

for revenue guarantees. 

a. If a local or state government or 

community organization chooses to 

fund a program to support new air 

service using non-airport funds, those 

funds may not be commingled with 

airport funds, and airport staff may not 

have responsibility for the handling and 

disposition of non-airport funds. Any 

funds placed in an airport’s account are 

treated as airport revenues. As long as 

community incentives are kept separate 

from airport funds, the community 

organization’s funding would not be 

considered airport revenue and 

therefore not subject to its special 

requirements. 

b. Airport staff can provide technical 

assistance to non-airport entities 

regarding ACIPs that do not use airport 

revenue, where the non-airport entity, 

and not the airport sponsor, is the 

agency responsible for decisions on 

expenditure of the funds. The role of 

airport staff can be advisory, but the 

airport staff cannot be involved in the 

decision-making process or handle nonairport funds. The airport staff’s 

assistance may include: 

i. Guidance on the economic viability 

of prospective markets; 

ii. Understanding of carrier business 

models and aircraft performance 

characteristics; 

iii. Information on the availability of 

the airport sponsor’s ACIP to support 

the new service within the limits 

described in this policy; 

iv. Other types of technical assistance 

consistent with the intent and overall 

parameters of this section. 

C. Marketing Incentives 

1. Airport sponsors are permitted to 

contribute to the marketing of new 

service, but airport funds must either 

flow directly to the marketing provider, 

or be provided to a carrier only after the 

carrier has paid the marketing provider 

and submitted an invoice to the airport 

for incentive-related marketing with 

supporting documentation. 

2. A marketing program must promote 

use of the airport. Use of airport funds 

for general economic development or for 

marketing and promotional activities 

unrelated to the airport is prohibited by 

49 U.S.C. 47107(k)(2)(B). 

D. Incentives for Individual Travelers 

1. Airport sponsors are prohibited 

from offering cash incentives to 

travelers for flying a route, as this 

indirectly subsidizes the carrier serving 

that route. 

2. However, airport sponsors are 

allowed to offer coupons for food, 

parking or other benefits tied to general 

use of the airport, as long as the benefit 

is not restricted to passengers who fly a 

specific carrier or route. 

IV. An ACIP May Not Result in an 

Increase in Charges for NonParticipating Carriers or Other 

Aeronautical Users of the Airport 

A. An ACIP May Not Increase Fees 

Charged to Non-Participating Carriers or 

Other Aeronautical Users and Tenants 

of the Airport Subject to the 

Requirement for Reasonable Fees Under 

49 U.S.C. 47107(a)(1) and Grant 

Assurance 22 

1. The costs of an ACIP may not be 

passed on to non-participating carriers 

or other aeronautical users in any form. 

The costs of an ACIP include direct 

costs, such as marketing, and the 

general costs of airport operation and 

maintenance that are not covered by the 

carrier in an ACIP as a result of a 

reduction or waiver of fees. 

2. An acceptable ACIP will not result 

in an increase in the sponsor charges to 

non-participating carriers, i.e., on the 

charges that carriers would have paid in 

the absence of the incentivized service. 

3. For an airport sponsor with a 

residual fee methodology, an ACIP may 

not reduce the residual payment to nonparticipating carriers each year. An 

ACIP may not reduce any other 

payments or credits that would 

otherwise be received from the airport 

sponsor in the absence of the 

incentivized service. 

V. An ACIP May Not Adversely Affect 

an Airport’s Self-Sustaining Rate 

Structure, as Required by Grant 

Assurance 24 

A. An ACIP Must Be Funded From a 

Source That Not Only Does Not Increase 

Rates for Non-Participating Parties, But 

Also Does Not Involve the Use of Funds 

Necessary for the Proper Operation and 

Maintenance of the Airport 

VI. FAA Oversight/Administration 

A. Restart of Previous Service 

1. Airport sponsors can use their own 

discretion when choosing whether to 

offer incentives for a carrier to restart 

service that the same carrier had offered 

previously but cancelled either due to 

extraordinary external circumstances 

(e.g., an extreme natural, manmade, or 

public health crisis, such as hurricanes, 

terrorism, or pandemic). 

2. In any event, discretion for service 

restart may not be used to extend an 

incentive beyond the limits provided in 

this policy. 

B. FAA Review 

1. The FAA does not approve ACIPs. 

At the request of an airport sponsor or 

of an air carrier potentially affected by 

an ACIP, the FAA will review an ACIP 


ddrumheller on DSK120RN23PROD with NOTICES1
Federal Register / Vol. 88, No. 234 / Thursday, December 7, 2023 / Notices 85357 

for compliance with the sponsor’s 

Federal obligations. 

C. Existing, New, and Modified 

Incentives 

1. Existing carrier incentives for 

which contracts are signed prior to the 

issuance date of this policy and up to 60 

days thereafter, under programs that 

were in effect on the issuance date of 

this policy and complied with the 

FAA’s previous policy guidance, may 

continue as implemented until they 

expire. All such existing incentives will 

expire within two years of the first flight 

that is eligible for an incentive. 

2. Incentives for which contracts are 

signed more than 60 days after the 

issuance date of this policy must 

conform to the guidance in this policy 

statement. 

3. Any new incentive program or 

modification of an existing incentive 

program after publication must comply 

with the requirements of this policy 

(i.e., without a 60-day grace period). 

Issued in Washington, DC. 

Kevin C. Willis, 

Director, Office of Airport Compliance and 

Management Analysis. 

[FR Doc. 2023–26809 Filed 12–6–23; 8:45 am] 

BILLING CODE P 

DEPARTMENT OF TRANSPORTATION 

Federal Railroad Administration 

[Docket Number FRA–2023–0087] 

Petition for Waiver of Compliance 

Under part 211 of title 49 Code of 

Federal Regulations (CFR), this 

document provides the public notice 

that on October 10, 2023, Union Pacific 

Railroad (UP) petitioned the Federal 

Railroad Administration (FRA) for a 

waiver of compliance from certain 

provisions of the Federal railroad safety 

regulations contained at 49 CFR part 

225 (Railroad Accidents/Incidents: 

Reports Classification, and 

Investigations). FRA assigned the 

petition Docket Number FRA–2023– 

0087. 

Specifically, UP requests relief from 

§ 225.25(h), Recordkeeping, which 

requires that a railroad post ‘‘a listing of 

all injuries and occupational illnesses 

reported to FRA as having occurred at 

an establishment . . . in a conspicuous 

location at that establishment.’’ In its 

petition, UP states that it ‘‘maintains a 

web portal that allows employees to 

access and review information from 

internet enabled electronic devices . . . 

[and] includes a link to UP’s posting of 

all injuries and occupational illnesses 

reported to the FRA.’’ In support of its 

request, UP states that the digital 

posting allows employees to access the 

injury and occupational illness 

information quickly and easily from any 

location and at any time of day. 

Additionally, the reporting team can 

keep the listings up-to-date and 

accurate. UP also states that the listing 

will additionally be available on a 

television mounted to a wall at work 

locations where such screens are 

available, beginning with the Council 

Bluffs, Iowa, terminal as a pilot site. 

Moreover, UP notes that ‘‘employees 

may also request a copy of the logs from 

their respective supervisor at any time.’’ 

A copy of the petition, as well as any 

written communications concerning the 

petition, is available for review online at 

www.regulations.gov. 

Interested parties are invited to 

participate in these proceedings by 

submitting written views, data, or 

comments. FRA does not anticipate 

scheduling a public hearing in 

connection with these proceedings since 

the facts do not appear to warrant a 

hearing. If any interested parties desire 

an opportunity for oral comment and a 

public hearing, they should notify FRA, 

in writing, before the end of the 

comment period and specify the basis 

for their request. 

All communications concerning these 

proceedings should identify the 

appropriate docket number and may be 

submitted at www.regulations.gov. 

Follow the online instructions for 

submitting comments. 

Communications received by 

February 5, 2024 will be considered by 

FRA before final action is taken. 

Comments received after that date will 

be considered if practicable. 

Anyone can search the electronic 

form of any written communications 

and comments received into any of our 

dockets by the name of the individual 

submitting the comment (or signing the 

document, if submitted on behalf of an 

association, business, labor union, etc.). 

Under 5 U.S.C. 553(c), DOT solicits 

comments from the public to better 

inform its processes. DOT posts these 

comments, without edit, including any 

personal information the commenter 

provides, to www.regulations.gov, as 

described in the system of records 

notice (DOT/ALL–14 FDMS), which can 

be reviewed at https://

www.transportation.gov/privacy. See 

also https://www.regulations.gov/ 

privacy-notice for the privacy notice of 

regulations.gov. 

Issued in Washington, DC. 

John Karl Alexy, 

Associate Administrator for Railroad Safety, 

Chief Safety Officer. 

[FR Doc. 2023–26804 Filed 12–6–23; 8:45 am] 

BILLING CODE P 

DEPARTMENT OF TRANSPORTATION 

Federal Transit Administration 

[FTA Docket No. FTA 2023–0030] 

Agency Information Collection Activity 

Under OMB Review: FTA Program 

Evaluation for Processes and 

Outcomes 

AGENCY: Federal Transit Administration 

(FTA), Department of Transportation 

(DOT). 

ACTION: Notice of request for comments. 

SUMMARY: In accordance with the 

Paperwork Reduction Act of 1995, this 

notice announces the intention of the 

Federal Transit Administration (FTA) to 

request the Office of Management and 

Budget (OMB) to approve a new 

information collection titled: FTA 

Program Evaluation for Processes and 

Outcomes. 

DATES: Comments must be received on 

or before February 5, 2024. 

ADDRESSES: You may send comments, 

identified by docket number FTA– 

2023–0030, by any of the following 

methods: 

• Federal eRulemaking Portal: 

https://www.regulations.gov, insert 

docket number FTA–2023–0030 in the 

keyword box and click ‘‘Search.’’ Next, 

choose the notice listed, click on the 

‘‘Comment’’ button, and follow the 

online instructions for submitting a 

comment. 

• Mail: Docket Management Facility, 

U.S. Department of Transportation, 1200 

New Jersey Avenue SE, West Building 

Ground Floor, Room W12–140, 

Washington, DC, 20590–0001. 

• Hand Delivery/Courier: West 

Building Ground Floor, Room W12–140, 

1200 New Jersey Avenue SE, 

Washington, DC, between 9 a.m. and 5 

p.m. ET, Monday through Friday, except 

Federal holidays. 

• Fax: (202) 493–2251. 

Instructions: You must include the 

agency name and docket number for this 

notice at the beginning of your 

comments. Submit two copies of your 

comments if you submit them by mail. 

For confirmation that FTA has received 

your comments, include a selfaddressed stamped postcard. Note that 

all comments received, including any 

personal information, will be posted 


ddrumheller on DSK120RN23PROD with NOTICES1